A Brief History of Management - Fun Facts and Insights for your weekend read

Management is the art and science of coordinating people, resources, and goals to achieve organizational objectives. But how did it evolve over time? And what are some of the interesting facts and insights that can help us understand its development and impact? In this blog post, we will explore the history of management from ancient times to the present day, highlighting some of the key milestones, theories, and practices that shaped the field.

Ancient Origins

The concept of management has been around for thousands of years. According to Pindur, Rogers, and Kim (1995), elemental approaches to management go back at least 3000 years before the birth of Christ, a time in which records of business dealings were first recorded by Middle Eastern priests. Socrates, around 400 BC, stated that management was a competency distinctly separate from possessing technical skills and knowledge (Higgins, 1991). The Romans, famous for their legions of warriors led by Centurions, provided accountability through the hierarchy of authority. The Catholic Church was organized along the lines of specific territories, a chain of command, and job descriptions. During the Middle Ages, a 1,000 year period roughly from 476 AD through 1450 AD, guilds, a collection of artisans and merchants provided goods, made by hand, ranging from bread to armor and swords for the Crusades. A hierarchy of control and power, similar to that of the Catholic Church, existed in which authority rested with the masters and trickled down to the journeymen and apprentices. These craftsmen were, in essence, small businesses producing products with varying degrees of quality, low rates of productivity, and little need for managerial control beyond that of the owner or master artisan.

Fun fact: The word "management" derives from the Latin word "manus", meaning "hand", which implies directing or handling something.

The Industrial Revolution

The Industrial Revolution, a time from the late 1700s through the 1800s, was a period of great upheaval and massive change in the way people lived and worked. Before this time, most people made their living farming or working and resided in rural communities. With the invention of the steam engine, numerous innovations occurred, including the automated movement of coal from underground mines, powering factories that now mass-produced goods previously made by hand, and railroad locomotives that could move products and materials across nations in a timely and efficient manner. Factories needed workers who, in turn, required direction and organization. As these facilities became more substantial and productive, the need for managing and coordination became an essential factor. Think of Henry Ford, the man who developed a moving assembly line to produce his automobiles. In the early 1900s, cars were put together by craftsmen who would modify components to fit their product. With the advent of standardized parts in 1908, followed by Ford’s revolutionary assembly line introduced in 1913, the time required to build a Model T fell from days to just a few hours (Klaess, 2020). From a managerial standpoint, skilled craftsmen were no longer necessary to build automobiles. The use of lower-cost labor and the increased production yielded by moving production lines called for the need to guide and manage these massive operations (Wilson, 2015).

Fun fact: The Industrial Revolution also gave rise to new forms of business organization, such as joint-stock companies (where investors own shares), corporations (where owners have limited liability), and trusts (where several companies merge under one board).

The Classical School

The classical school of management emerged in response to the challenges posed by the Industrial
Revolution. It is based on the assumption that management is a rational and scientific process that can be studied and improved through observation and experimentation. The classical school consists of three main branches: scientific management, administrative management, and bureaucratic management.

Scientific management focuses on improving efficiency and productivity at the level of individual workers and tasks. It was pioneered by Frederick Winslow Taylor in the late 1800s and early 1900s. Taylor advocated for breaking down work into simple and standardized steps,

measuring output and time spent on each step, selecting workers based on their abilities, training them to perform their tasks optimally, and rewarding them based on their performance.

Taylor's method was also known as Taylorism or “the one best way”.

Administrative management focuses on improving efficiency and productivity at the level of managers and organizations. It was developed by Henri Fayol in the early 1900s. Fayol proposed that managers should perform five basic functions: planning, organizing, commanding, coordinating, and controlling.

He also identified general principles of management, such as division of work, authority and responsibility, unity of command, unity of direction, scalar chain, and esprit de corps.

Bureaucratic management focuses on creating a rational and formal structure for organizations. It was proposed by Max Weber in the early 1900s. Weber argued that bureaucracy was the most efficient and effective form of organization, based on features such as a clear hierarchy of authority, a division of labor, a system of rules and regulations, an impersonal and merit-based selection and promotion system, and a separation of personal and professional affairs.

Fun fact: The first management consulting firm in history was founded in 1883 in Philadelphia by Frederick Winslow Taylor, who marketed himself as a “Consulting Engineer – systemizing shop management and manufacturing costs,” later to be called Taylor’s Method. He was later criticized for knowing too little about the companies he managed & that his method of consulting was nothing more than a “party trick.” This was to later be refuted (Element Project Services, n.d.).

The Behavioral School

The behavioral school of management emerged as a reaction to the limitations and criticisms of the classical school. It is based on the assumption that management is a social and human process that can be improved by understanding and motivating people. The behavioral school consists of several subfields, such as human relations, organizational behavior, and organizational development.

Human relations focuses on the psychological and social aspects of work and workers. It was influenced by the Hawthorne studies conducted by Elton Mayo and his colleagues at the Western Electric Company in the 1920s and 1930s. The Hawthorne studies revealed that workers' performance and satisfaction were affected not only by physical factors, such as lighting and temperature, but also by social factors, such as group norms, leadership styles, and employee involvement.

Organizational behavior focuses on the interactions among individuals, groups, and organizations. It draws on various disciplines, such as psychology, sociology, anthropology, and economics, to explain and predict human behavior in organizational settings. Some of the topics studied by organizational behavior include personality, attitudes, motivation, emotions, communication, decision making, conflict, power, politics, culture, diversity, ethics, and change.

Organizational development that focuses on improving the effectiveness and well-being of organizations through planned interventions. It is based on the principles of action research, which involves diagnosing problems, designing solutions, implementing changes, and evaluating outcomes.

Some of the techniques used by organizational development include team building, survey feedback, participative management, quality circles, and total quality management.

Fun fact: One of the pioneers of organizational behavior was Abraham Maslow, who proposed the famous hierarchy of needs theory in 1943. According to Maslow, human needs can be arranged in a pyramid, from the most basic (physiological) to the most advanced (self-actualization). Maslow argued that people are motivated to satisfy their unmet needs in order of priority.

The Contemporary School

The contemporary school of management emerged as a response to the challenges posed by the changing environment and technology. It is based on the assumption that management is a dynamic and complex process that can be improved by adapting to new situations and opportunities. The contemporary school consists of several perspectives, such as systems theory, contingency theory, and learning organizations.

Systems theory focuses on viewing organizations as open systems that interact with their environment. It was influenced by the work of Ludwig von Bertalanffy in the 1940s and 1950s.

Systems theory emphasizes the interdependence and interrelatedness of organizational elements, such as inputs, outputs, processes, feedback, and goals. Systems theory also recognizes the importance of external factors, such as customers, suppliers, competitors, and regulators.

Contingency theory focuses on finding the best fit between organizational variables and environmental conditions. It was developed by several scholars in the 1960s and 1970s, such as Paul Lawrence, Jay Lorsch, Fred Fiedler, and Victor Vroom.

Contingency theory suggests that there is no one best way to manage or organize, but rather that different situations require different approaches. Some of the factors that affect contingency theory include size, structure, strategy, technology, culture, and leadership.

Learning organizations focus on creating a culture of continuous learning and improvement within organizations. It was popularized by Peter Senge in his book The Fifth Discipline in 1990. Learning organizations encourage employees to acquire new knowledge and skills, share information and ideas, experiment with new methods, learn from mistakes, and adapt to change.

Learning organizations also foster a shared vision, teamwork, systems thinking, personal mastery, and mental models.

Fun fact: One of the most influential contemporary management thinkers is Peter Drucker, who coined the term "knowledge worker" in 1959. Drucker argued that knowledge workers are those who use their minds to create value in the economy, rather than their physical labor or capital.

 Drucker was one of the first to recognize that the industrial age was giving way to the information age, where knowledge and innovation would be the main drivers of economic growth and social change. He saw that knowledge workers had different needs and challenges than traditional workers, such as autonomy, learning, collaboration, and creativity. Also, he saw that knowledge work required different forms of organization and leadership than hierarchical bureaucracies, such as decentralized teams, networks, and communities.

His concept of knowledge work has become even more relevant in the 21st century, as technology has enabled the creation, dissemination, and application of knowledge at an unprecedented scale and speed. Knowledge workers now constitute a large and growing segment of the workforce in developed and developing countries alike, spanning across various sectors and professions. It is also increasingly interdisciplinary and collaborative, requiring knowledge workers to communicate and cooperate with diverse stakeholders and experts.